Kroger's Simple Truth organic line reaches $1.6 billion in sales

CINCINNATI — Since launching it three years ago, Kroger has grown its Simple Truth line of organic products to a $1.6 billion enterprise, Mike Schlotman EVP and CFO, shared with analysts at the Goldman Sachs Global Staples Forum Tuesday. "It's something we're very proud of," he said. "Why didn't some of the big food companies step back and [develop] a national brand for organics?" he asked. "There is the opportunity to be a little bit of a disruptor in some of those categories where there is a void in figuring out how to fill it."

Schlotman feels that organic growth potential within Kroger is significant, especially as more shoppers give the grocer credit for having an exclusive high-quality organic line in store. "Today, you see incremental households buying different products in the organic category, whether it's millennials [or] baby boomers," he said. "And we continue to introduce new products. We just recently launched an extension of our Simple Truth line [with] salad dressings that are in our produce department."

Schlotman credited Kroger's corporate brands team for building the organic private label line. There are two categories on which that team focuses on. There's KMP, or Kroger Manufactured Products, which include dairy lines and bakery items, and KLP, Kroger Label Product.

Kroger also recently enhanced its KLP offering through a line called HemisFares, Schlotman said. "Just phenomenal product," he said. "It's a little bit of a 'foodie' hunt in each one of these stores because each one of these products is numbered and there's a story behind each number of the product and the idea is to get people to try every number in succession," he noted. "It was never meant to be as big as Simple Truth, but it's filling a niche in certain categories."

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